How to Grow an Agency by Becoming Optional - Leadership Training and Building Personal Warmth with Karl Sakas

Gray MacKenzie welcomes Karl Sakas back to Agency Journey for his fourth appearance on the show. Karl is an agency advisor and the founder of Sakas & Company, where he has consulted with over 600 agencies in 36 countries. In this episode, they dig into the practical steps agency owners need to take to make themselves optional in their business - and why leadership training and personal warmth are the keys to getting there.

The Four Stages of Becoming Optional

Karl outlines a clear progression that agency owners move through on their way to becoming truly optional in their business. The first stage is Mandatory - where the agency cannot function without the owner present. If you take a week off and things fall apart, you are in this stage. The second stage is Necessary - the agency can survive short absences, but the owner is still required for key decisions and client relationships.

The third stage is Needed - the team handles most operations independently, but the owner still adds meaningful value in strategic areas. The final stage is Optional - the agency runs smoothly whether the owner is involved day-to-day or not. Karl emphasizes that before you start building a plan, you need to define what success looks like. Do you want an exit? Passive ownership? A lifestyle business? The answer shapes everything about the timeline and approach.

Getting to Optional also requires honest assessment of your financials. If you want to hire a senior leader who can eventually replace you in key functions, you need to be realistic about compensation. Rising stars expect competitive pay, and underpaying for a critical role sets both parties up for frustration.

Leadership Development as the Path Forward

Karl recommends Manager Tools’ Effective Manager Training as a starting point for agency owners and their emerging leaders. The fundamentals of good management - one-on-ones, feedback, coaching, delegation - are skills that most agency owners never formally learn. They get promoted from doing the work to managing the people doing the work, with no training in between.

Weekly 30-minute one-on-ones with each direct report are the single most impactful habit Karl recommends. These meetings should be driven by the team member’s agenda, not the manager’s. Karl shares feedback from one team member who said it was “the first time a manager has ever asked what she wanted to talk about.” That level of attention signals care and builds trust faster than any other management tactic.

Karl also cautions against throwing high-potential staff into executive roles prematurely. Just because someone is great at their current job does not mean they are ready to manage a team or run a department. Structured progression plans - with clear milestones and support - give future leaders the runway they need to grow into bigger roles.

Why Warmth Beats Competence in Leadership

After receiving feedback through a 360 evaluation that he excelled at execution but lacked warmth, Karl made a deliberate shift in his leadership approach. He credits the experience - and a subsequent leadership bootcamp through Grinnell Leadership’s Jumpstart program - as genuinely life-changing.

The research backs this up. Karl references “The Human Brand” by Chris Malone and Susan Fisk, which demonstrates that people evaluate leaders on two dimensions: warmth and competence. Most agency owners over-index on competence. They are great at strategy, delivery, and problem-solving. But warmth - the sense that you genuinely care about the people around you - is what drives loyalty, engagement, and retention.

Karl now invests in personal connection intentionally. He follows up on team members’ personal lives, remembers details about their families, and sends handwritten thank-you notes. He estimates spending approximately $1,500 per year on postage alone. It sounds small, but the impact compounds. People remember when their manager asks about their kid’s soccer game or sends a note after a tough week. Those moments build the relational equity that keeps teams together through hard seasons.

The Power of 360 Evaluations

Karl strongly advocates for 360 evaluations as a tool for leadership growth. The gap between self-perception and external reality is often significant - and usually invisible without structured feedback. Most agency owners assume they are good managers because nobody tells them otherwise. A 360 creates a safe structure for honest input from peers, direct reports, and even clients.

The key is approaching the feedback with genuine openness. Karl notes that the experience can be uncomfortable, but the insights are worth it. If you discover that your team sees you as competent but cold, that is actionable information. If you learn that your communication style creates anxiety rather than clarity, you can change it. The alternative - operating on assumptions about how people experience your leadership - is far more dangerous.

Resources Mentioned

• Karl Sakas on LinkedIn - Agency Advisor and Founder of Sakas & Company
• Sakas & Company - Agency consulting and advisory
• Work Less, Earn More - Karl’s book on agency growth
• Manager Tools - Effective Manager Training
• The Human Brand by Chris Malone and Susan Fisk
• Agency Leadership Intensive - Karl’s leadership development program